Endogenous cool-off periods

Mark van Oldeniel and Noemi Peter

Journal of Economic Behavior & Organization, 2025, vol. 238, issue C

Abstract: We run an ultimatum game experiment where cool-off periods can emerge endogenously, that is, where proposers can decide to impose a waiting period on responders. Previous research focused on cool-off periods that were exogenously imposed by the researcher, but in real life people can make deliberate choices to impose such periods on others for strategic reasons. Since in our experiment cool-off periods can be imposed endogenously, we can answer several novel research questions. First, how willing are individuals to impose endogenous cool-off periods on others? Second, do offers change if cool-off is an option? Third, are endogenously imposed cool-offs effective? Finally, how does the possibility of imposing an endogenous cool-off period affect bargaining breakdowns and earnings? We find that 40% of proposers choose to impose a cool-off period on responders. Proposers make significantly lower offers when they can impose a cool-off period on responders. Endogenous cool-off periods are not effective in increasing the overall acceptance rate. The possibility to create an endogenous cool-off period does not have a significant effect on bargaining breakdowns or earnings overall. However, it lowers responder earnings significantly, as it allows proposers to exploit the timing choice to make a lower offer. Our results highlight that instead of helping to solve conflicts, the possibility to create cool-off periods hurts the less powerful party.

Keywords: Cool-off period; Strategic decision; Lab experiment; Ultimatum game (search for similar items in EconPapers)
JEL-codes: C72 C90 D63 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0167268125003567
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:238:y:2025:i:c:s0167268125003567

DOI: 10.1016/j.jebo.2025.107237

Access Statistics for this article

Journal of Economic Behavior & Organization is currently edited by Houser, D. and Puzzello, D.

More articles in Journal of Economic Behavior & Organization from Elsevier
Bibliographic data for series maintained by Catherine Liu ().